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ΕΜΠΟΡΙΚΟ & ΒΙΟΜΗΧΑΝΙΚΟ ΕΠΙΜΕΛΗΤΗΡΙΟ ΘΕΣΣΑΛΟΝΙΚΗΣ - Ε.Β.Ε.Θ ΕΜΠΟΡΙΚΟ & ΒΙΟΜΗΧΑΝΙΚΟ ΕΠΙΜΕΛΗΤΗΡΙΟ ΘΕΣΣΑΛΟΝΙΚΗΣ - Ε.Β.Ε.Θ

The 25th TCCI Barometer

27/04/21 13:25

“TCCI BAROMETER” (Executive Summary)

Thessaloniki Chamber of Commerce and Industry (TCCI), consistent to its efforts to increase information levels and inform both businesses and organizations (public or private) as well as Thessaloniki’s community, continues the periodic Survey of Economic Climate (at the Prefecture of Thessaloniki) on the four business sectors of the economy and consumers.

The Survey of Economic Climate at the Prefecture of Thessaloniki (TCCI Barometer) is conducted twice a year during the 2nd fortnight of March and September, with a total sample of 1500 respondents (800 companies and 700 consumers). The survey covers all four sectors of the economy (industry, services, retail trade and constructions).

TCCI Barometer” survey is conducted via telephone interviews with the managers of businesses (General Managers, or Finance Managers, or Sales Managers or the owners in case of “smaller” companies) and with the use of questionnaires used by the Foundation for Economic & Industrial Research and the European Union, so that the results are comparable with the equivalent National and European surveys.

 

IMPORTANT METHODOLOGICAL NOTE ABOUT TCCI BAROMETER–MARCH/SEPTEMBER 2020 AND MARCH 2021

The consumer and business field surveys at the Prefecture of Thessaloniki, upon which all the TCCI Barometer March 2020 indicators are based, were conducted in the midst of the coronavirus epidemic crisis. More specifically, the Consumer survey was conducted between March 23rd and April 1st, 2020, while the Business survey was conducted between March 23rd and April 7th, 2020.  During this period, all the restraining measures to combat the coronavirus epidemic were put into action and implemented, such as the suspension of operation of both businesses’ and the public sector, as well as the citizens’ restraining of movement. Therefore, the TCCI Barometer of March 2020 indicators, fully reflect the consumer and business climate amidst the coronavirus epidemic crisis. Respectively, the consumer and business field surveys at the Prefecture of Thessaloniki upon which all the TCCI Barometer September 2020 indicators are based, were conducted amidst the second wave of the coronavirus epidemic in Greece, between September 22nd and 30th 2020. Finally, the consumer and business field surveys of the TCCI Barometer for March 2021, were also conducted during the peak of the third wave of the COVID-19 epidemic in Greece, between the 22nd and the 31st March 2021 among consumers and the 30th March and 8th April 2021 among businesses. During this period limitations on civilian’s movements were still in place, retail trade was on hold and alternative modes of work (such as teleworking) were imposed on both the public and the private sector of the economy.  As a result, all the TCCI indicators still reflect the serious consequences of the continuous economic crisis that derived from the coronavirus pandemic, both in Greece and worldwide.

National indicators are made up by the consumer and business surveys conducted by the Foundation for Economic and Industrial Research (ΙΟΒΕ), which are part of the common research program funded by the European Union (DG ECFIN) - these results, are used in the calculation of the economic climate indicators in Greece and the rest of the EU countries. Taking the Foundation for Economic and Industrial Research announcement into consideration about the National indicators for March 2020, “it is highlighted that one part of the primary survey was conducted before the implementation of the suspension of operation in specific sectors of the economy and a bigger part of the primary survey was conducted even before the implementation of the citizens’ restraining of transportation. Thus, the indicators’ projection doesn’t entirely incorporate in full-range the developments that occurred during March. Regarding this fact, a further, probably more powerful deterioration of the climate and expectations in general, is possible in the following months”.

Based on the above, it is important to take into consideration that this time difference, though short in days, between the primary research that feeds the National and European indicators and the relevant one of the TCCI Barometer that feeds those of the Thessaloniki Prefecture, renders these indicators incomparable for March 2020, due to the coronavirus crisis developments that occurred during this period, both in Greece as well as in a series of other European countries.

 


 

 

1.CONSUMER SURVEY

The “Consumer Confidence Indicator” is calculated based on consumer’s predictions for the general economic situation of the country, the economic situation of their household, the intention for saving and their prediction for unemployment levels. It must be mentioned that predictions are between +100 (all consumers anticipate an increase) to -100 (all consumers anticipate a decrease) and appear as differences between positive and negative responses. In particular, a negative difference means that the percentage of those who predict a decrease is higher than the one of those who predict an increase and vice – versa.

According to the survey, consumers at the Prefecture of Thessaloniki still show intense concern and pessimism amidst the coronavirus epidemic crisis and currently the Consumer Confidence Indicator stands at -34 points – with a slight 7-point increase compared to recent “September 2020”.


The survey shows continued adverse climate among consumers, as the Consumer Confidence Indicator remains at very negative ground and far from the  -2 points in September 2019 – the highest point ever recorded since the beginning of the “TCCI Barometer” in March 2009 – at -34 points today. The euphoria that followed the results of the National Elections of July 2019 and lead consumer confidence to an almost “optimistic” level, has given its place to a sense of intense concern and worry as far as the “next day” of the coronavirus epidemic is concerned. And this is totally justified, since already by the end of March – when the consumer survey was conducted - 43% of those who participated stated that their income has been reduced, 27% stated that their job was either suspended or permanently lost (got fired) and also another 27% stated that their business has been reduced. This situation appears to continue even today (March 2021), though in a milder degree, but seemingly in a more permanent manner: 15% of those who participated in the current survey stated that their work was temporarily suspended, 12% stated that their income has been reduced as a result of the coronavirus epidemic, 9% stated that their work or business overall has been reduced and, finally, 5% stated that their job was temporarily or permanently lost (got fired).Overall, it seems that the consequences of the COVID-19 epidemic are gradually becoming permanent but at significantly lower level compared to March and September 2020. Nevertheless, consumers are very cautious when it comes to predicting the time of possible return to “normality” and to pre-epidemic conditions (the majority expects that to happen no sooner than 2022), which results in consumers being very reluctant to proceed to major purchases of good and/or services, as well as to increase spending, at least for the immediate future.

 

In particular, consumers at the Prefecture of Thessaloniki indicate:

 

  • On one hand, a constant negative evaluation of their economic situation for the preceding period (compared to September 2020), while on the other hand, a significant reduction of pessimism about its future development, as there is a remarkable decrease in the percentage of those who expect a deterioration of their household’s economic situation over the next months (from 38% in September 2020 to 27% currently), while the majority (47%) predicts a stabilization of their  economic situation for the following 12 months.

                                                                                                                                   

  • The percentage of those who stated that the country’s general economic situation has (in a smaller or larger degree) deteriorated over the past year, has further rocketed to 88% (compared to 66% in September 2020). At the same time the percentage of those who estimate that the country’s general economic situation over the next 12 months will deteriorate, remains at a very negative level (55% today compared to 63% last September 2020).

 

  • Consumers in the Prefecture of Thessaloniki estimate that prices have been stabilized during the past 12 months (46% from 53% last September), while the percentage of those who detect some increase in prices has been increased to 43% from 34% last September. Meanwhile, the percentage of consumers who believe that consumer prices will be stable over the next 12 months remains almost unchanged (41% versus 44% last September 2020).

 

  • Consumers seem extremely pessimistic as far as unemployment levels are concerned, since the majority of respondents believe that unemployment levels will increase “A lot” or “Somewhat” (71% compared to 83% in September 2020), while at the same time there is an increase of the percentage of those who believe that unemployment levels will decline over the next 12 months (17% compared to 8% last September 2020).  

 

  • As far as the consumer’s evaluation of current circumstances to make major purchases is concerned, there seems to be no change since September 2020 (14% considers that this is an appropriate time for important purchases such as furniture, electric appliances etc., compared to 13% in September 2020), still though remaining at a very negative ground. A slight improvement is recorded in the indicator measuring the willingness to make such purchases in the future, still though remaining in negative ground.

 

  • A stable intention to save is reported, compared to September 2020, while there is a marginal decrease in the percentage of those who say they live at the expense of their savings or borrow money (23% from 26%) and an increase of those who say that they just break even with their income (52% compared to 49% in September 2020).

 

  • A stable outlook is expected as far as the car market is concerned in the Prefecture of Thessaloniki, with 7% of the consumers saying that it is very or highly likely to make a car purchase over the next 12 months (8% in September 2020).

 

  • A stable outlook is also expected on the real estate market and the intention to buy or build a house (5% today compared to 4% last September), whereas the construction activity is generally expected to significantly increase as far as the renovations and / or repairs-house improvements are concerned: the corresponding indicator has increased significantly (16% over 9% in September 2020).

2.INDUSTRY SURVEY

The “Business Expectations Indicator for the Industrial Sector” at the Prefecture of Thessaloniki still remains at negative level, showing though significant improvement compared to September 2020, for the second consecutive semester.

Thus, the balance of positive – negative estimates of the “Business Expectations Indicator for the Industrial Sector” stands now at -11 points at the Prefecture of Thessaloniki. It must be noted that this indicator, reached its worst level on March 2020, since the beginning of the TCCI Barometer surveys in March 2009, but showed an important recovery in September 2020 (from -41 in March 2020 to -25 in September 2020), which continued this semester.

After a two-year period that the Business Expectations Indicator for the Industrial Sector appeared to “flirt” with positive grounds, moving away from the negative numbers that were consistently recorded from 2009 up to 2016-2017, the appearance of the coronavirus epidemic as well as the development and implementation of the restraining measures to combat the sanitary crisis, have led to its downfall at an even worse level than the one recorded during Greece’s recent economic crisis (2010-2011). One year later  (March 2021), a significant recovery of the “Business Expectations Indicator for the Industrial Sector” is observed, which is mainly based on the recovery of expectations for production level and level of exports for the following six month period. However, the ongoing development of the coronavirus pandemic, both in a national and worldwide level, is the factor that will determine the indicator’s future course.

In particular, the views of the industrial sector at the Prefecture of Thessaloniki are summarized as follows:

  • There is continued negative evaluation as far as production is concerned (-48 to -56) over the past 6 months. Estimates regarding the evolution of production in the near future at the Prefecture of Thessaloniki, have returned to positive ground, significantly improved compared to last September and especially March 2020, when it had reached its worst level since the establishment of the TCCI Barometer surveys (-66 to +18 today).
  • There is a satisfying management of inventories and production capacity. At the same time, the current production capacity level, after its significant reduction on March 2020 compared to September 2019 (60% from 72%), has currently recovered slightly to 65%.  At the same time, the number of assured months of production based on current overall books has increased to 2,8 months (2,9 in September 2020) after the plunge at 1,5 months last March – the worst performance ever recorded since the establishment of the TCCI Barometer.
  • As far as the future of exports levels is concerned estimates are now neutral (-2 from -7 last September and -51 in March 2020).
  • A significant rise of product prices is expected for the near future (in line with similar trends at National and European level), as well as a quite probable upward trend for employment over the near future.
  1. SERVICES SURVEY

Negative but improved climate is recorded by services at the Prefecture of Thessaloniki compared to September 2020, with the “Business Expectations Indicator for the Services sector” significantly improved compared to six months ago.

More specifically, the relevant “Business Expectations Indicator for the Services Sector” is recorded at a negative ground (-14 points), significantly improved since last September (-33), but very far from the highly positive ground it stood in September 2019 for the first time since the beginning of the “TCCI Barometer” in March 2009.

In particular, services at the Prefecture of Thessaloniki mention:

 

  • Negative evaluation of their business situation but significantly improved compared to September 2020 (-59 in September 2020 compared to -44 currently) and constantly negative evaluation for the demand over the last six months.

 

  • A recovery of expectations for the demand over the next six months is recorded, far from the lowest value ever recorded over the past decade last March 2020 (-58 in March 2020, -12 in September 2020 and +32 today), returning to positive ground.

 

  • There are neutral estimates as far as the level of employment is concerned during the past 6 months, and an upward trend for employment during the next six months is expected. Finally, a stabilization trend of price levels is recorded for the next semester.



 


 

 

4.RETAIL TRADE SURVEY

Significant improvement is recorded as far as the climate among Retail Businesses at the Prefecture of Thessaloniki is concerned, compared to that of September 2020, with the “Business Expectations Indicator for the Retail Trade sector”, however, remaining on negative ground.

Thus, the balance of positive – negative estimates of the “Business Expectations Indicator for the Retail Trade sector” stands at -11 points (from -31 in September 2020).

In particular, the views of Retail businesses at the Prefecture of Thessaloniki can be summarized as follows:

  • A negative but slightly improved compared to last September (-49 from -68) evaluation is observed about sales during the past six months, while, on the other hand, expectations about sales in the next six months have rocketed (+18 from -39 last September 2020), regaining optimism after 1,5 year of negative outlook. In addition, a great increase is observed as far as the development of orders are concerned for the next six months (from -40 points in September 2020 to +5 today).
  • Moreover, they foresee a slight increase of employment in their sector and a significant rise as far as product prices are concerned in the near future.

 


 

 

5.CONSTRUCTION SURVEY

A slight upward trend of the Construction Sector expectations is observed, still remaining though at negative ground. The “Business Expectations Indicator for the Construction Sector” in the Prefecture of Thessaloniki has slightly improved.

Thus, the balance of positive – negative estimates of the “Business Expectations Indicator for the Construction Sector” stands at -23 points at the Prefecture of Thessaloniki (compared to -26 in September 2020).


In particular, the views of Construction businesses at the Prefecture of Thessaloniki can be summarized as follows:

  • The construction activity indicator over the last six months is reported steadily negative (-31 points today compared to -34 points last September 2020).
  • Stability (at negative level) is recorded as far as the current levels of orders is concerned.
  • A stabilizing trend appears in the expected employment levels over the next 6 months and a significantly upward trend as far as the real estate prices are concerned.

 

 


 

6.TCCI Barometer – AD HOC CONSUMER QUESTIONS

Aiming at the optimum use of "TCCI Barometer" as a research tool with a view to better inform the business community of Thessaloniki, new ad-hoc questions were incorporated in “TCCI Barometer’s” questionnaires. The questions were placed at the end of standardized questionnaires used "TCCI Barometer" to ensure continuity and reliability of the results of "TCCI Barometer".

  • Feelings about the COVID - 19 pandemic

Concerns about the impact of the COVID-19 pandemic on their household finances (63% say they are "Very" and "Somewhat" concerned) seem to overshadow consumers' concerns about the corresponding impact on their health (55%). At the same time, feelings such as frustration (18% from 9% in June 2020), anger (18% from 6% in June 2020) and pessimism (14% from 4% in June 2020) are growing, while anxiety (30%) and insecurity (25%) predominate. Feelings such as optimism (10%), hope (9%) and sense of security (1%) are at a very low level and there is now a complete lack of confidence about the pandemic (0%).

 

  • Changes in consumer behavior

A number of changes in consumer behavior came with the COVID-19 pandemic and it seems that at a significant degree they will remain after its end. More specifically, about 1 in 3 consumers (or 35%) say they will shop online more often, 29% say they will pay for their purchases via mobile more often and 1 in 5 (or 20%) say they will use video calls and fast food delivery services more often, 18% say they will use video conferencing platforms more often and about 1 in 7 (or 15%) say they will work more often from home. At the same time, 53% say that their online shopping has increased compared to the pre-pandemic period (compared to 30% in September 2020 and 29% in July 2020). Finding offers and discounts on desirable products and services due to the COVID-19 pandemic is a practice that is already used by 57% of respondents (and 48% say they will continue to do so in the future), while 43% pay more purchases now with credit cards (and 36% say they will continue to do so in the future), 41% are looking for cheaper products from other brands (and 32% say they will continue to do so in the future) and 38% have delayed / postponed significant purchases (cars, holidays, home appliances / furniture etc and 23% say they will continue to postpone them in the future). It is striking that 25% say they have even reduced their purchases of basic daily goods due to the COVID-19 pandemic (and 15% say they will continue to do so in the future). Clothing / footwear (35%) and holidays / travel (35%) are the purchases that have been postponed mainly by consumers due to the COVID-19 pandemic, followed by home appliances (14%), furniture (14%), cars (11%), personal electronic devices (11%), smart phones (11%) and insurance (5%). The majority, however, say they will proceed to these purchases when the COVID-19 pandemic begins to subside in Greece (38%) and 15% when the pandemic ends in Greece. For approximately 15% of the respondents, however, these purchases will only take place when the COVID-19 pandemic subsides (7%) or ends (8%) worldwide.

  • Holidays

About 3 in 10 (or 29%) state that they will not take a vacation in the next 12 months, while about 1 in 3 (or 34%) plan to take a vacation in Greece at some paid accommodation (hotel, rented house or apartment etc). 22% of the respondents will choose to take a vacation in a private holiday home / residence in Greece, while 19% will choose a vacation in Greece in a relative’s or friend's house. Only 6% say they are planning a vacation abroad.

  • Time horizon of the COVID-19 pandemic

The majority of respondents do not think that the COVID-19 pandemic will end soon: 31% believe that this will happen sometime in 2022, 25% see it further away, from 2023 onwards, while 13% believe that our lives will never return to the pre-pandemic state. Only 27% say that the pandemic will end sometime before the end of 2021.

 


 

7.TCCI Barometer – AD HOC ENTERPRISES QUESTIONS

  • Liquidity:  A crucial parameter for businesses

About 1 in 4 companies (or 23%) state that their liquidity is at critical level for their further operation and survival, while 4 in 10 (or 41%) characterize it as reduced / below normal. Only for about 1 in 3 companies (or 31%) liquidity is characterized as normal and a mere 3% characterize it as increased / above normal. At the same time, 77% of the companies in the Prefecture of Thessaloniki state that they have been supported "A Little" or "Not at all" by the financial tools that have been allocated so far by the Government in order to meet their liquidity needs.

  • "Wounds" from the pandemic are deep, State measures to deal with them are seen as insufficient and ineffective

3 in 4 companies (or 73%) in the Prefecture of Thessaloniki state that their turnover has decreased due to the COVID-19 pandemic, slightly lower compared to the previous period and the onset of the pandemic. At the same time, 53% characterize the measures taken by the State to date to support businesses from the effects of the COVID-19 pandemic as insufficient and ineffective. However, there is more optimism among businesses than among consumers about the end of the pandemic: 46% believe that their company has already returned (13%) or will return by the end of 2021 (33%) to normal operating level.

 

Thessaloniki, April 12th 2021

PALMOS ANALYSIS

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